Texas Codes

Tex. Bus. Orgs. Code § 21.223 (2026)

Limitation Of Liability For Obligations

✓ current as of May 2026

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Sec. 21.223. LIMITATION OF LIABILITY FOR OBLIGATIONS. (a) A holder of shares, an owner of any beneficial interest in shares, or a subscriber for shares whose subscription has been accepted, or any affiliate of such a holder, owner, or subscriber or of the corporation, may not be held liable to the corporation or its obligees with respect to:

(1) the shares, other than the obligation to pay to the corporation the full amount of consideration, fixed in compliance with Sections 21.157-21.162, for which the shares were or are to be issued;

(2) any contractual obligation of the corporation or any matter relating to or arising from the obligation on the basis that the holder, beneficial owner, subscriber, or affiliate is or was the alter ego of the corporation or on the basis of actual or constructive fraud, a sham to perpetrate a fraud, or other similar theory; or

(3) any obligation of the corporation on the basis of the failure of the corporation to observe any corporate formality, including the failure to:

(A) comply with this code or the certificate of formation or bylaws of the corporation; or

(B) observe any requirement prescribed by this code or the certificate of formation or bylaws of the corporation for acts to be taken by the corporation or its directors or shareholders.

(b) Subsection (a)(2) does not prevent or limit the liability of a holder, beneficial owner, subscriber, or affiliate if the obligee demonstrates that the holder, beneficial owner, subscriber, or affiliate caused the corporation to be used for the purpose of perpetrating and did perpetrate an actual fraud on the obligee primarily for the direct personal benefit of the holder, beneficial owner, subscriber, or affiliate.

Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 688 (H.B. 1737), Sec. 74, eff. September 1, 2007.

Notes of Decisions

Cited in 183 cases (55 in the last 5 years), 2005–2026 · leading case: Hong v. Havey, 551 S.W.3d 875 (Tex. App. 2018).

Sort: Relevance Newest Treatment

Hong v. Havey, 551 S.W.3d 875 (Tex. App. 2018). · cites it 11× “See Tex. Bus. Orgs. Code Ann. §§ 21.223 , 21.”

Husky Int'l Elec., Inc. v. Ritz, 136 S. Ct. 1581 (2016). · cites it 2× “See Tex. Bus. Orgs. Code Ann. §21.223 (b) (West 2012).”

Stanley Shook// Terry Walden & Joy Walden v. Terry Walden & Joy Walden// Stanley Shook, Patrick Jaehne & S&J Endeavors, L.L.C., 368 S.W.3d 604 (Tex. App. 2012). · cites it 6× “Laws 12 267, 427 (amended 2007) (current version at Tex. Bus. Orgs. Code Ann. §§ 21.223 , .224 (West Pamph.”

Husky Int'l Elec., Inc. v. Ritz (In Re Ritz), 832 F.3d 560 (5th Cir. 2016). · cites it 4× “005; (2) these fraudulent transfers under TUF- *564 TA allowed Husky to pierce the corporate veil and hold Ritz personally liable for Chrysalis’s debt, see Tex. Bus. Org. Code Ann. § 21.223 (b); and (3) 11 U.”

Spring Street Prt - IV, L.P. v. Douglas Lam, 730 F.3d 427 (5th Cir. 2013). · cites it 5× “21, re-codified at Tex. Bus. Orgs.Code § 21.223 (citations omitted).”

Walker v. Anderson, 232 S.W.3d 899 (Tex. App. 2007). · cites it 4× “See Tex. Bus. Orgs.Code Ann. § 21.223 (Vernon Supp.”

Tryco Enter. Inc., Sharon C. Dixon, James Dixon, Crown Staffing, Inc. & Troy Keith Dixon v. James A. Robinson, 390 S.W.3d 497 (Tex. App. 2012). · cites it 6× “” Tex. Bus. ORGS. Code Ann. § 21.223 (a)(3) (West 2011).”

U.S. Kingking, LLC v. Precision Energy Servs., Inc., 555 S.W.3d 200 (Tex. App. 2018). · cites it 4× “TEX. BUS. ORGS. CODE ANN. § 21.223 (West 2012).”

Formosa Plastics Corp., USA v. Kajima Int'l, Inc., 216 S.W.3d 436 (Tex. App. 2006). · cites it 4× “BUS. ORG.CODE ANN. § 21.223 (Vernon Supp.”

Akin, Gump, Strauss, Hauer & Feld, L.L.P. v. Nat'l Dev. & Rsch. Corp., 299 S.W.3d 106 (Tex. 2009). · cites it 2× “See Tex. Bus. Orgs. Code § 21.223 (stating that any affiliate of a corporation shall be under no obligation to the corporation or to its obli-gees with respect to “any contractual obligation of the corporation or any matter relating to or arising from the obligation” unless “the…”

TransPecos Banks v. Jodi Strobach, 487 S.W.3d 722 (Tex. App. 2016). · cites it 4× “]” Tex. Bus. ORGS. Code Ann. § 21.223 (a)(2) (West 2012) (emphasis added).”

Penhollow Custom Homes, LLC v. Kim, 320 S.W.3d 366 (Tex. App. 2010). · cites it 4× “Tex.Bus. Orgs.Code Ann. § 21.223(a)(2)(Vernon Pamph.”

Show all 183 citing cases →

— Tex. Bus. Orgs. Code § 21.223(2) — 1 case

Spring Street Prt - IV, L.P. v. Douglas Lam, 730 F.3d 427 (5th Cir. 2013). “21, re-codified at Tex. Bus. Orgs.Code § 21.223 (citations omitted).”

— Tex. Bus. Orgs. Code § 21.223(a) — 14 cases

Seidler v. Morgan, 277 S.W.3d 549 (Tex. App. 2009).

Willis v. Donnelly, 199 S.W.3d 262 (Tex. 2006).

Wooley v. Lucksinger, 14 So. 3d 311 (La. Ct. App. 2009).

Lone Star Air Sys., LTD v. David Powers, 401 S.W.3d 855 (Tex. App. 2013).

Walser v. Texas Music Grp., Inc. (In Re Antone's Records, Inc.), 445 B.R. 758 (Bankr. W.D. Tex. 2011).

— Tex. Bus. Orgs. Code § 21.223(a)(2) — 37 cases

Walker v. Anderson, 232 S.W.3d 899 (Tex. App. 2007). “See Tex. Bus. Orgs.Code Ann. § 21.223 (Vernon Supp.”

Spring Street Prt - IV, L.P. v. Douglas Lam, 730 F.3d 427 (5th Cir. 2013). “21, re-codified at Tex. Bus. Orgs.Code § 21.223 (citations omitted).”

Sparks v. Booth, 232 S.W.3d 853 (Tex. App. 2007).

Tryco Enter. Inc., Sharon C. Dixon, James Dixon, Crown Staffing, Inc. & Troy Keith Dixon v. James A. Robinson, 390 S.W.3d 497 (Tex. App. 2012). “” Tex. Bus. ORGS. Code Ann. § 21.223 (a)(3) (West 2011).”

Penhollow Custom Homes, LLC v. Kim, 320 S.W.3d 366 (Tex. App. 2010). “Tex.Bus. Orgs.Code Ann. § 21.223(a)(2)(Vernon Pamph.”

— Tex. Bus. Orgs. Code § 21.223(a)(2)(3) — 1 case

Chico Auto Parts & Serv., Inc. v. Crockett, 512 S.W.3d 560 (Tex. App. 2017).

— Tex. Bus. Orgs. Code § 21.223(a)(3) — 8 cases

Booth v. Kontomitras, 485 S.W.3d 461 (Tex. App. 2016).

the Peterson Grp., Inc., PGI Dev. Grp., LP, & Wellington Yu v. PLTQ Lotus Grp., L.P. & Cubo Grp., L.L.C., 417 S.W.3d 46 (Tex. App. 2013).

Penhollow Custom Homes, LLC v. Kim, 320 S.W.3d 366 (Tex. App. 2010). “Tex.Bus. Orgs.Code Ann. § 21.223(a)(2)(Vernon Pamph.”

Bale v. Ryan (In Re Ryan), 443 B.R. 395 (Bankr. N.D. Tex. 2010).

Abraham Flores v. Lorance Bodden, 488 F. App'x 770 (5th Cir. 2012).

— Tex. Bus. Orgs. Code § 21.223(b) — 52 cases

U.S. Kingking, LLC v. Precision Energy Servs., Inc., 555 S.W.3d 200 (Tex. App. 2018). “TEX. BUS. ORGS. CODE ANN. § 21.223 (West 2012).”

Shandong Yinguang Chem. Indus. Jt. Stock Co. v. Potter, 607 F.3d 1029 (5th Cir. 2010).

Lee C. Ritchie v. Ann Caldwell Rupe, as Tr. for the Dallas Gordon Rupe, III 1995 Fam. Trust, 443 S.W.3d 856 (Tex. 2014).

Bates Energy Oil & Gas v. Complete Oilfield Servs., 361 F. Supp. 3d 633 (W.D. Tex. 2019).

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